Most of the discussion going around is centered around the struggle between Facebook and Foursquare. Even though Facebook has been saying they’ve been working with them, it’s crystal clear, the new announcement has hurt them in a really bad way.

So, the big question, will Facebook outflank Foursquare? I’m afraid the odds of Foursquare winning this battle are rather thin. The key driver in the location space is the user base of these systems. The more people checking in and leaving geotags the more useful the system becomes. In that aspect, Facebook just dwarfs Foursquare.

Not only that, but to use those systems you need a specific app. Problem is that most people already have the Facebook app, getting into Foursquare would mean going through the extra hassle of downloading and configuring a new app, while the Facebook app not only has a much larger audience, but it comes preconfigured in most new smartphones.

Now, what could Foursquare do to fight back? It’s clear they really need to differentiate themselves from Facebook. They need something that you can only get on Foursquare and not from Facebook. I’m not sure if that’s something they’re going to be capable of doing if Facebook plays their cards correctly. Any new feature that gets any traction can be easily replicated by Facebook. They only possible way is to make something so different from the Facebook genoma that they won’t be able to replicate it because it goes against the Facebook strategy.

For example, even though they tried to transform the news feed into the Twitter feed, the Twitter audience kept using Twitter. The main reason is in how different the follow/followers dynamics are from the friend/no friend dynamics of Facebook. That simple thing is what really prevents Facebook from collapsing Twitter. The thing is that Facebook can’t change the way the deal with social relations in an easy was because that would mean changing the core dynamics of the company. Something like that is what Foursquare should pull out of their sleeve if they want to stay alive.

Many people have been saying that what the location space needs is a shared geolocation database, maintained by several companies so that each company could focus on developing cool things on top of it. With Facebook on the loose, they’re saying that Facebook could become the maintainer of that database. The problem is that, while the original hypothesis made sense, the Facebook one is extremely dangerous. The first one assumed several guardians, the second one just one, Facebook. Needless to say that having Facebook control the whole location data is like handing the keys of your kingdom. Information and data is key here, even though it’s a tedious task, it’s critical to build features that allow you to differentiate from Facebook.

Let the geowars begin!! Any comments? Insights? Should have Foursquare planned for this attack before hand? What do you think?